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Approvals, Pent-Up Demand Continue to Rise, Says CNW

Auto loan approvals continued to pick up in April, the same month pent-up demand reached its highest level since the third quarter 2008, according to CNW Research.

by Staff
May 18, 2010
2 min to read


BANDON, Ore. — Auto loan approvals continued to pick up in April, the same month pent-up demand reached its highest level since the third quarter 2008, according to CNW Research.

Excluding leases, balloon notes and other non-traditional financing, approval rates for prime (750+) and near prime (620-749) grew from 88.31 percent and 79.57 percent in March, respectively, to 89.93 percent and 81.44 percent in April. Subprime approvals grew from 9.52 percent to 10.28 percent in April, the highest point since before October 2008.

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Including all forms of financing, prime and near-prime approval rates grew from 90.24 percent and 84.63 percent in March, respectively, to 92.56 percent and 86.81 percent in April. Approvals for all forms of subprime financing grew from 13.81 percent in March to 14.71 percent in April, the highest point since September 2009. Subprime approvals, however, remained at their lowest levels since CNW began recording auto loan approvals in January 2002.

Pent-up demand was also on the rise in the first quarter, increasing 164.9 percent from the first quarter 2009 ― the largest increase since the third quarter 2008. Demand for used vehicles, however, declined by 88.5 percent from the year-ago quarter.

Consumer pent-up demand for the quarter reached its highest point in March, with the average delay in purchasing decreasing from 15.34 months in March 2009 to 8.92 months in March 2010. February was the best month for used vehicles, although the average monthly delay in purchasing increased by 10.3 percent.

Pent-up demand for new vehicles in April increased by 156.2 percent compared to the year-ago period, with the average delay in purchasing decreasing from 13.82 months in April 2009 to 7.52 months in April 2010.

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